Luang Namtha, Oudomxay and Bokeo provinces, located in the North- Western part of Lao PDR, have benefited long ago from a strategic position at the crossroads between Thailand, China, Myanmar and Vietnam. They were part of the caravan trade network that thrived between the thirteenth and nineteenth century, and then, of the Golden Triangle opium trade. Due to its geographical assets and its cross-border trade linkages, Northern Lao PDR is once again at the forefront of the regional stage through the implementation of the GMS North-South Economic Corridor (NSEC), which links Kunming to Bangkok by crossing the Northern provinces of Lao PDR. However, this regional integration process also means dramatic socio-economic changes in the remote and impoverished Upland Lao PDR. Will Northern Lao PDR be able to reap the benefits from the NSEC eventually? How is the NSEC impacting on local livelihoods, and who are the main drivers of change?

This research aims to examine the Asian Development Bank's argument that Lao PDR could become the crossroads of the trade routes in the GMS if this landlocked country manages to turn to its advantage the migration and transnational networks passing through its territory. I will explore the role of Chinese networks in regional trade, since the increasing flow of Chinese newcomers into Lao PDR is obviously metamorphosing the socio-economic landscape of the region. The present research is based on empirical data — interviews with Chinese migrants and Lao officials as well as analysis of socioeconomic statistics and reports — collected between 2007 and 2009 during several fieldwork studies carried out in the main cities of three Northern provinces of Lao PDR (Oudomxay, Luang Namtha, Bokeo) affected by the NSEC (see Map 18.1).

First, I will describe what is at stake since Lao PDR has been involved in the GMS programme, and specifically in the case of implementing the NSEC. Then, I will describe how Chinese newcomers are gradually weaving their transnational networks into Lao economy and how they are accelerating the pace of change in the region.